Power Solutions International, Inc. (NASDAQ:PSIX) Files An 8-K Entry into a Material Definitive Agreement
Item 1.01 Entry into a Material Definitive Agreement.
On October 1, 2019, Power Solutions International, Inc. (the Company) and Doosan Infracore Co., Ltd. (Doosan) entered into an addendum to the Supply Agreement, dated as of December 11, 2007 (the Supply Agreement), by and between Doosan and the Company, as amended by the prior addenda thereto (the Addendum).
The Addendum extends the term of the Supply Agreement to December 31, 2023, after which the agreement will automatically be extended for additional one-year terms unless a notice of termination is provided by either party six months prior to the scheduled expiration. The Addendum prohibits Doosan from specified product development in partnership with the Companys existing or potential customers and competitors. The Addendum extends the Companys exclusivity for the prescribed territory but carves out of the restriction the competing engine products supplied by General Motors Company and Weichai Power Co., Ltd. (Weichai). The Company committed to maximize sales and service opportunities on both Doosan and Weichai engine products, recognizing their different value proposition and target markets. The Addendum also updates the minimum product purchase commitments for the period 2019 through 2023, subject to reductions based on market declines in oil prices and defined prescribed payments to Doosan triggered by shortfalls in purchases made by the Company during each annual calendar period.
The Addendum is attached to this Current Report on Form 8-K as Exhibit 10.1 and is incorporated by reference herein. The foregoing summary of the Addendum is qualified in its entirety by the complete text of the Addendum filed herewith.
For further information regarding the Supply Agreement, see the copy of the Supply Agreement (as previously amended) filed as Exhibit 10.12 to Amendment No. 4 to the Companys Current Report on Form 8-K dated April 29, 2011, filed with the Commission on August 12, 2011.
Item 9.01 Financial Statements and Exhibits.